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Motorola Solutions, Smartrac Settle Patent Litigation by Round Rock

The two RFID hardware vendors have entered into a licensing agreement with the patent holder, allowing them to sell products using Round Rock's patents, effectively releasing the vendors' customers from Round Rock lawsuits.
By Claire Swedberg
Nov 04, 2013

Motorola Solutions and Smartrac have signed settlements with patent-licensing company Round Rock Research, thereby ending a lawsuit between Motorola and Round Rock, as well as halting Round Rock's suits against multiple companies that employ Motorola's RFID readers and Smartrac's tags. Motorola Solutions and Smartrac now have a license for Round Rock's patents, though the companies have declined to disclose the terms of the agreement.

Round Rock Research is a patent-licensing firm with several thousand patents and pending applications. The company does not manufacture, sell or market any products or services. Instead, it operates as a non-practicing entity (NPE), or what is sometimes referred to as a "patent-assertion entity" (PAE) or "patent troll," earning revenue solely by licensing and enforcing its patents. On Dec. 14, 2011, the Mount Kisco, N.Y., firm filed lawsuits against nine companies using products provided by Motorola, Smartrac and other RFID vendors, charging that the solutions infringed on five of Round Rock's radio frequency identification patents granted by the U.S. Patent and Trademark Office. Those companies consisted of American Apparel, Dole Food, Fruit of the Loom, Gap, HanesBrands, JC Penney, Macy's Retail Holdings, PepsiCo and V.F. Corp (see RFID Lawsuit Not a Major Issue for RFID and Courting Confusion). A week later, Round Rock filed a similar lawsuit against Amazon.com, claiming the online merchant infringed on nine Round Rock U.S. RFID patents. In March, 2012, the company added Wal-mart Stores Inc. to the list of defendants, claiming the retailer violated 10 of Round Rock's U.S. RFID patents. In all 11 lawsuits, Round Rock asked that it be awarded damages adequate to compensate for the alleged infringement, that such damages be determined by a jury and be trebled, with interest, and that it also be reimbursed for its legal expenses.

Round Rock acquired patents related to the use of ultrahigh-frequency (UHF) RFID tags and readers from semiconductor company Micron Technology.

In response to being sued by Round Rock, some of those firms then demanded defense and indemnification against Round Rock's claims of patent infringement from Motorola Solutions, under the indemnification clauses in their contracts with Motorola. In March 2012, Motorola filed a countersuit against Round Rock, challenging its claims. This ongoing litigation created some uncertainty—not only for the end users named in the lawsuits, but also for others who were potential customers and were concerned about becoming pulled into the patent dispute.

With the settlement announced today, Motorola reports, all pending litigation between it and Round Rock has now been terminated. Meanwhile, end users are being instructed to contact Motorola or Smartrac to begin the process of having the Round Rock patent lawsuit dismissed.

"This is good news for Motorola and for its customers," says Tama McWhinney, Motorola Solutions' corporate communications director. "We're now free from the distraction of the litigation." The vendor's customers, she adds, "can feel free to use our readers with licensed RFID tags." What's more, she says, since the agreement with Round Rock is not exclusive, "We would anticipate that other RFID suppliers will contact Round Rock to discuss their own licensing deals."

The agreements promise to spur greater interest in RFID.

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